What is CIT v. Birla Gwalior (P.) Ltd. authority for?

The Supreme Court holds that income tax is levied on real income, not on hypothetical or notional accrual. For income to be taxable, it must genuinely accrue or be received, taking into account the realistic probability of its realization.

How many judgments cite CIT v. Birla Gwalior (P.) Ltd.?

83 judgments on BharatTax cite CIT v. Birla Gwalior (P.) Ltd. (89 ITR 266), spanning 2010 to 2025.

Which sections of the Income Tax Act does CIT v. Birla Gwalior (P.) Ltd. come up under?

It is most often cited in judgments turning on Section 143(3), Section 147, Section 148, Section 143(1), Section 144, Section 145.

CIT v. Birla Gwalior (P.) Ltd. (89 ITR 266)

ITO-41(3)(2), MUMBAI, MUMBAI vs. K S CHAMANKAR ENTERPRISES, MALAD (E),MUMBAI

In the result, appeal of the Revenue is dismissed

ITA 4586/MUM/2024[2012-13]Status: DisposedITAT Mumbai19 Aug 2025AY 2012-13

Bench: Shri Saktijit Dey & Shri Prabhash Shankarincome Tax Officer, Ward V/S. K S Chamankar Enterprises, – 41(3)(2), Room No. 851, बनाम B-15, Pethe Nagar, Kedarmal 8Th Floor, Kautilya Bhavan, Road, Malad(E), Mumbai – Bandra Kurla Complex, 400097, Maharashtra Bandra (East), Mumbai 400051, Maharashtra स्थायी लेखा सं./जीआइआर सं./Pan/Gir No: Aagfk5823R Appellant/अपीलार्थी .. Respondent/प्रतिवादी

For Appellant: Shri Bharat Raichandani, Adv. [virtually appear]For Respondent: Shri Ritesh Mishra,(CIT-DR)

Section 143(3)Section 147Section 28

…ve really accrued to the assessee company. The Court referred to the judgment of the Court in H.M. Kashiparekh & Co. Ltd. vs. CIT (1960) 39 ITR 706 (Bom) which view was approved by the Supreme Court in CIT vs. Birla Gwalior (P) Ltd. 1973 CTR (SC) 349 : (1973) 89 ITR 266 (SC). What can therefore, be assessed is real income as income-tax is a tax on income, The test therefore, before income can be taxed is whether there is real accrual of income. In our opinion, the ratio of that judgement fully applied to the facts of the present case. 5. In the instant case, there is no accrual of income. There is dispute between…

CHANDRA BROS.,KOLKATA vs. I.T.O., WARD - 37(1), KOLKATA, KOLKATA

In the result, the appeal filed by the assessee is partly allowed for statistical purposes

ITA 1572/KOL/2024[2022-2023]Status: DisposedITAT Kolkata22 Jul 2025AY 2022-2023

Bench: Sri Pradip Kumar Choubey & Sri Rakesh Mishra

Section 143(1)Section 145(2)Section 250Section 44A

…974 CTR (SC) 157: (1972) 83 ITR 211 (SC); and iii) It is well settled that what is taxable under the income-tax law is only real income vide CIT vs. Shoorji Vallabhdas and Co. (1962) 46 ITR 144 (SC) and CIT vs. Birla Gwalior (P) Ltd. 1973 CTR (SC) 349: (1973) 89 ITR 266 (SC). There is, therefore, no principle by which the stock-in-trade can be valued at market price so as to bring to tax the notional profits which might in future be realised as a result of the sale of the stock-in-trade. In the present case, if the valuation of closing stock is changed from LIFO to Weighted Average Basis, it will invariably signi…

WEIR MINERALS (INDIA) PRIVATE LTD,NEW DELHI vs. DCIT CIRCLE-27(1), NEW DELHI

In the result, the appeal of the assessee is party allowed

ITA 4713/DEL/2019[2012-13]Status: DisposedITAT Delhi06 Jun 2025AY 2012-13

Bench: Ms. Madhumita Roy & Shri Khettra Mohan Roy[Assessment Year 2012-13]

Section 143(3)Section 234B

…e High Court was right in coming to the conclusion that on the facts of this case the larger income neither. accrued nor was received by the assessee firm." • Godhra Electricity Co. Ltd. v. CIT: [1997) 225 ITR 746 (SC) • CIT v. Birla Gwalior (P.) Ltd : [1973] 89 ITR 266 (SC) • Poona Electric Supply Co. Ltd. v. CIT: [1965) 57 ITR 521 (SC) • Brahamputra Capital & Financial Services Ltd. v. ITO [2009] 119 ITD 266 (Delhi) • H.M. Kashiparekh & Co. Ltd. v. CIT : [1960) 39 ITR 706 (BOM.) • CIT v. Motor Credit Co. (P.) Ltd.: [1981] 6 Taxman 63 (Madras) • M/s. Nutan Warehousing Co. Pvt. Ltd v. ACIT: IT No.471/PUN/2018 • E…

ACIT, C. R. BUILDING vs. HANSDEEP INDUSTRIES AND TRADING COMPANY LTD., FOURTH FLOOR, LINK HOUSE,

In the result, the appeal is allowed

ITA 3466/DEL/2023[2016-17]Status: DisposedITAT Delhi28 May 2025AY 2016-17

Bench: Shri Satbeer Singh Godara & Shri Manish Agarwalassessment Year: 2016-17 Vs. M/S. Acit, Hansdeep Industries C.R. Building & Trading Company Ltd., New Delhi 4Th Floor, Link House, 3 Bahadur Shah Zafar Marg, New Delhi Pan: Aabcj0776A (Appellant) (Respondent) Assessee By Sh. Ankit Kumar, Adv. Sh. Lalit Mohan, Ca Department By Sh. Rajesh Kumar Dhanesta, Sr. Dr Date Of Hearing 28.05.2025 Date Of Pronouncement 28.05.2025 Order

Section 143(3)Section 5Section 57

…me Court, High Court and ITAT are available from the case laws discussed below. 5.1. In Godhra Electricity Company (1997) 225 ITR 746 (SC), reiterating its earlier decision in Morvi Industries Ltd. v. CIT (1971) 82 ITR 835 (SC) and CIT v. Birla Gwalior (1973) 89 ITR 266 (SC), the Supreme Court held that tax cannot be imposed on hypothetical accrual of income. It was observed that the question of real accrual of income must be considered by taking the probability of realisation in a realistic manner. 5.2. The Supreme Court in the case of Poona Electric Supply v. Ld. CIT(Appeals) (1965) 57 ITR 21 (SC) held that inc…

DCIT, CIRCLE-1(1), HYDERABAD, HYDERABAD vs. PRAKASH NIMMAGADDA, HYDERABAD, SECUNDERABAD

In the result, appeal filed by the Revenue is dismissed

ITA 974/HYD/2017[2008-09]Status: DisposedITAT Hyderabad16 Dec 2024AY 2008-09

Bench: Shri Vijay Pal Rao, Vice-A N D Shri Manjunatha, G.आ.अपी.सं /Ita No.974/Hyd/2017 (िनधा"रण वष"/Assessment Year: 2008-09) Dy.Cit Vs. Shri Prakash Nimmagadda Circle 1(1) Hyderabad Hyderabad Pan:Acbpn4246R (Appellant) (Respondent) िनधा""रती "ारा/Assessee By: Shri K.C. Devdas, Ca राज" व "ारा/Revenue By:: Dr. Meghnath Chowhan, Cit(Dr) सुनवाई की तारीख/Date Of Hearing: 06/11/2024 घोषणा की तारीख/Pronouncement: 16/12/2024 आदेश/Order Per Vijay Pal Raothis Appeal Filed By The Revenue Is Directed Against The Order, Dated 20/03/2017 Of The Learned Cit (A)-9, Hyderabad, Relating To A.Y.2008-09. 2. The Revenue Has Raised The Following Grounds:

For Appellant: Shri K.C. Devdas, CAFor Respondent: : Dr. Meghnath Chowhan, CIT(DR)

Section 17(2)(c)Section 28

…ITA No 974 of 2017 Prakash Nimmagadda आयकर अपील"य अ"धकरण, हैदराबाद पीठ IN THE INCOME TAX APPELLATE TRIBUNAL Hyderabad ‘ B ‘ Bench, Hyderabad Before Shri Vijay Pal Rao, Vice-President A N D Shri Manjunatha, G. Accountant Member आ.अपी.सं /ITA No.974/Hyd/2017 (िनधा"रण वष"/Assessment Year: 2008-09) Dy.CIT Vs. Shri Prakash Nimmagadda Circle 1(1) Hyderabad Hyderabad PAN:ACBPN4246R (Appellant) (Respondent) िनधा""रती "ारा/Assessee by: Shri K.C. Devdas, CA राज" व "ारा/Revenue by:: Dr. Meghnath Chowhan, CIT(DR) सुनवाई की तारीख/Date of hearing: 06/11/2024 घोषणा की तारीख/Pronouncement: 16/12/2024 आदेश/ORDER Per Vijay P…

ACIT, CENTRAL CRCLE-18, NEW DELHI vs. SHIMMER DEVELOPERS P.LTD, NEW DELHI

In the result, appeal of the Revenue is dismissed

ITA 1497/DEL/2018[2011-12]Status: DisposedITAT Delhi21 Oct 2024AY 2011-12

Bench: Pradip Kumar Kedia & Shri Anubhav Sharma

Section 132Section 143(3)Section 147Section 150Section 68

…charges. Consequently, it challenged the inclusion of such amount within its assessable income on the ground that no real income had accrued. Reiterating its earlier decision in Morvi Industries Ltd. v. CIT and CIT v. Birla Gtoalior, (1974) 3 SCC 196: (1973) 89 ITR 266 the Court held that extra tax cannot be imposed on hypothetical accrual of income. It was observed that the question of real accrual of income must be considered by taking the probability of realization in a realistic manner. Applying the above principle, courts have consistently refrained from allowing taxation of notional profits and interest th…

THE PR. COMMISSIONER OF INCOME TAX -7 vs. RELIGARE SECURITIES LTD.

ITA - 474 / 2024HC Delhi02 Sept 2024

Section 260A

…in Commissioner of Income Tax v. Excel Industries Ltd: observed as follows:- “24. This Court did not accept the view taken by the High Court on facts. Reference was made in this context to Commissioner of Income Tax v. Birla Gwalior (P.) Ltd., [1973] 89 ITR 266 (SC) wherein it was held, after referring to Morvi Industries that real accrual of income and not a hypothetical accrual of income ought to be taken into consideration. 2 2024:DHC:6076-DB For a similar conclusion, reference was made to Poona Electric Supply Co. Ltd. v. Commissioner of This is a dig…

PRAGATI POWER CORPORATION LTD,NEW DELHI vs. ACIT, CIRCLE 20(1), NEW DELHI

In the result, the appeal filed by the assessee is partly allowed as indicated above

ITA 1617/DEL/2023[2018-19]Status: DisposedITAT Delhi14 Aug 2024AY 2018-19

Bench: SHRI S.RIFAUR RAHMAN (Accountant Member), SHRI SUDHIR PAREEK (Judicial Member)

Section 115JSection 145(2)Section 32Section 36Section 36(1)(iii)Section 37Section 43ASection 46ASection 80I

…ze. ii) In the case of Godhara Electricity Co. Ltd. vs CIT (1997) 225 ITR 746 (SC), Supreme Court relied upon the following cases:- CIT vs Shoorji Ballabhdas & Co. (1962) 46 ITR 144 (SC) Pragati Power Corporation vs. ACIT CIT vs Birla Gwalior (P) Ltd. (1973) 89 ITR 266 (SC) Morvi Industies Ltd. vs CIT (1971) 82 ITR 835 (SC) Poona Electric Supply Company Ltd. vs CIT(1965) 57 ITR 521 (SC) Kashiparekh (H.M.) & Co. Ltd. vs CIT (1960) 39 ITR 706 (Bom) State Bank of Travencore vs CIT(1986) 158 ITR 102 (Ker) Supreme Court held in this case that the question, whether there was real accrual of income to the assessee Co.…

ACIT , CENTRAL CIRCLE - 3 (3), CHENNAI vs. M/S LAND MARVEL HOMES , CHENNAI

In the result, appeal filed by the Revenue is allowed

ITA 1055/CHNY/2022[2012-2013]Status: DisposedITAT Chennai26 Jul 2024AY 2012-2013

Bench: Shri Aby T Varkey, Hon’Ble & Shri S. R. Raghunatha, Hon’Bleआयकरअपीलसं./Ita No.: 1055/Chny/2022 िनधा"रणवष" / Assessment Year: 2012-13 M/S. Land Marvel Homes, The Acit, V. 45-47, Old No. 22-23, Central Circle -3(3), 3Rd Floor, 1St Main Road, Chennai. Gandhi Nagar, Adyar, Chennai – 600 020. [Pan:Aabfl-4387-N] (अपीलाथ"/Appellant) (""यथ"/Respondent) अपीलाथ"क"ओरसे/Appellant By : Shri. V. Nandakumar, Cit ""यथ"क"ओरसे/Respondent By : Shri. T. Banusekar, Advocate & Shri. Yeshwanth Kumar, Ca सुनवाई क" तारीख/Date Of Hearing : 06.06.2024 घोषणा क" तारीख/Date Of Pronouncement : 26.07.2024 आदेश /O R D E R

For Appellant: Shri. V. Nandakumar, CITFor Respondent: Shri. T. Banusekar, Advocate &

Section 142(1)Section 143(1)Section 143(2)Section 143(3)Section 147Section 148

…tted that it is well settled law that, what is taxable under the Income Tax Law is only a real income and cited the decision in the case of CIT v. M/s.Shoorji Vallabhdas& Co., reported in [1962] 46 ITR 144 and CIT v. Birla Gwalior (P) Ltd., reported in [1973] 89 ITR 266 and submitted that there is no principle by which the stock in trade can be valued at market price so as to bring to tax the :-6-: ITA. No:1055/Chny/2022 notional profits which might in future be realized as a result of sale of the stock in trade. 7. The Ld.AR of the assessee citing the decision of the Hon’ble Madras High Court in the case of M/s…

PR. COMMISSIONER OF INCOME TAX-2, DELHI vs. M/S BHISHANSAROOP RAM

ITA/953/2019HC Delhi28 Mar 2024

Bench: HON'BLE MR. JUSTICE YASHWANT VARMA,HON'BLE MR. JUSTICE PURUSHAINDRA KUMAR KAURAV

…s downloaded from the DHC Server on 04/04/2024 at 11:54:48 consumers. This Court did not accept the view taken by the High Court on facts. Reference was made in this context to CIT v. Birla Gwalior (P) Ltd. [(1974) 3 SCC 196 : 1973 SCC (Tax) 519 : (1973) 89 ITR 266], wherein it was held, after referring to Morvi Industries [Morvi Industries Ltd. v. CIT, (1972) 4 SCC 451 : 1974 SCC (Tax) 140 : (1971) 82 ITR 835] that real accrual of income and not a hypothetical accrual of income ought to be taken into consideration. For a similar conclusion, reference was made to Poona Electric Supply Co. Ltd. v. CIT [(…